Subject: File No. S7-15-10
From: Kris Beaulieu
Affiliation: Registered Representative

July 28, 2010

In regards to changes in 12b-1 fees I think the SEC should allow for an option for advisor service fees to remain above the 0.25%. While it's true that many fund companies or registered representatives are collect/are paid the 12b-1 fee as a trail on accounts they never service many registered representatives work to continue a relationship with the investor and continue to service the account. Allowing for competition of sales charges and service fees may at first appear to be in the best interest of a client it can inadvertantly put the client in a worse situation.

Many registered reps such as Edward Jones reps are often not allowed to do fee based accounts or something such as a C share. They have to continue to look for new business and new money to be invested to stay with the company otherwise they will be let go, leaving the client without someone they trust for guidance. Those clients often feel they have an advisor who is constantly watching their account when in fact the represntative has to focus the majority of their time looking for new money and not servicing the clients they currently have. Independent advisors who use C shares often reach a point where they do not look for new money but simply strive to manage their assets under management. The fact they are paid a higher service fee makes managing their current clients business the most important task because it is the most profitable for them. That is exactly what many clients want, an advisor or representative that is staying in touch and focusing on their accounts instead of constantly looking for new ones.

I think there should be an option for clients to sign a disclosure acknowledging they are paying higher service fees in exchange for something of value, service from a registered representative. Registered representatives help clients in many ways from asset allocation to simply not panicing and making emotional decisions just because the market has a down day or week. Perhaps the client has to sign a new form every few years to ensure that service is being done. Taking this option away will be as big of a step backward as you may think it is going forward. You may say fee based accounts are the solution but they don't work for everyone. Many firms have minimums that have to be met for a fee based account and when a client does not have that yet or meets the minimum for an IRA account but not a new 529 account, what is the client to do? Don't take away their options, instead allow them to keep the options they have now. That is the point of capitalism and free markets, consumer choices.